High inflationary pressures continue to weigh on U.S. producer prices — but not as much as in previous months.
There are growing signs that strong inflation in the US is slowing. After consumer prices, producer prices also did not rise strongly in October. They were up 8.0% compared to the same month last year, the Labor Department reported Tuesday in Washington. Economists polled by Reuters had expected 8.3%, down from 8.4% in September.
In the figures, prices are listed ex-factory – that is, before the products are further processed or traded. They provide early signals of growth in consumer prices. These rose to 7.7% in October after the inflation rate stood at 8.2% in the previous month.
However, the central bank’s stability target of 2.0% is still a long way off. US monetary authorities are targeting an inflation rate of 2.0%. The Federal Reserve has been raising interest rates unusually for months to keep inflation under control. Most recently, she increased it again to three-quarters of a percent. It is currently in the range of 3.75 to 4.00%.
The central bank is poised to step up, but signaled that it may soon slow some of the pace of tightening moves. Recently, reports from Federal Reserve Vice Chairman Lael Brainard suggested that the Fed may raise the key interest rate by only half a percentage point in December. In a Bloomberg interview, he called the surprisingly sharp drop in the inflation rate to half a percent “reassuring.”